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Posts Tagged ‘stock market

“Induction for deduction, with a view to construction”*…

 

Mushroom cloud from the world’s first successful hydrogen bomb test, Nov. 1, 1952

At RAND in 1954, Armen A. Alchian conducted the world’s first event study to infer the fissile fuel material used in the manufacturing of the newly-developed hydrogen bomb. Successfully identifying lithium as the fissile fuel using only publicly available financial data, the paper was seen as a threat to national security and was immediately confiscated and destroyed…

How a bench researcher used publicly-available market data to unlock the secret of the H Bomb: “The Stock Market Speaks: How Dr. Alchian Learned to Build the Bomb” (pdf).

* Auguste Compte (attributed by John Arthur Thomson in a quote at heading of the chapter “Scientific Method,” in his Introduction to Science

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As we comb the columns, we might recall that it was on this date in 1883 that the S.S. Daphne sank moments after her launching at the shipyard of Alexander Stephen and Sons in Glasgow.  The 500-ton steamer went down with 200 men on board– all of them working to finish her before the shipyard closed for the Glasgow Fair.  Only 70 were saved.

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Written by LW

July 3, 2017 at 1:01 am

“This world’s a bubble”*…

 

From “The Bay Area to Standard English Translator.”

[A similarly silly-but-serious bonus: “An Interactive Guide to Ambiguous Grammar.”]

* alternately attributed to St. Augustine and to Francis Bacon

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As we send birthday greetings to the father of the field of sociology and the discipline of Positivism, August Comte, we might recall that it was on this date in 1929 that bearish economist Roger Babson gave a speech in which he warned, “sooner or later, a crash is coming, and it may be terrific.” He had been delivering this message for two years, but for the first time, investors listened. The stock market took a severe dip (now known in economic history as “the Babson Break”).  The next day, prices stabilized, but the equity collapse that we know as a trigger event for the Great Depression had begun.

Roger Babson

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Written by LW

September 5, 2015 at 1:01 am

“Heigh ho, heigh ho, it’s off to work we go”*…

 

Researchers often look at the number of hours worked, but rarely do they ask the question of when. Fortunately, the government conducts an annual study called the American Time Use Survey that tracks how people spend their days…

The interactive graph pictured above (and available live here) shows the share of workers who say they’re working in a given hour, grouped by occupation. The tabs at the top allow one to focus on different job categories to see how their average workdays differ from one another.  For example, servers and cooks have a schedule that’s essentially the opposite of all other occupations; their hours peak during lunch and hold steady well into the evening.

Explore more at “Who’s In The Office? The American Workday In One Graph.”

* Disney’s Seven Dwarfs

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As we breathe a sigh of relief that these studies don’t extend to what one does at work, we might recall it was on this date in 1929 that panicked sellers traded nearly 16 million shares on the New York Stock Exchange (four times the normal volume at the time), and the Dow Jones Industrial Average fell 12%. Remembered as “Black Tuesday,” this was the conclusive event in the Crash of 1929, and is often cited as the start of the Great Depression.

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Written by LW

October 29, 2014 at 1:01 am

Our robot overlords at work…

The research firm Nanex presented the stunning animation below as part of a presentation at Wired‘s Business Conference. It represents one half-second of trading orders for just one stock–  Johnson & Johnson– routed through just twelve exchanges. 

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This kind of high-frequency trading accounted for approximately 50% of all US equity trading volume in 2012. The central point of the presentation is that the rush by traders to speed-at-all-costs has created a system largely populated by “ghost bids” (meant to bait other traders into inadvisable trades) and a resultant degree of confusion that means that, in a bid-and-ask system that’s meant to clear trades both efficiently and effectively, “it is impossible to verify that a trade received the best price.”

The financial industry’s response?  It’s turning to lasers for even faster trades…

See the full Nanex presentation here (and read the underlying research here).

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As we ponder Asimov’s Three Laws, we might send tasty birthday greetings to Nicholas Kurti (nee Miklós Mór Kürti); he was born on this date in 1908.  Born in Romania, educated in Paris and Berlin, Kurti fled Hitler’s rise to settle at the Clarendon laboratory at Oxford, where he became was one of the premier low-temperature physicists of his era (he conducted record-breaking nuclear cooling experiments that came within a millionth of a degree of absolute zero).

But Kurti, an enthusiastic advocate of applying scientific knowledge to culinary problems, was also renowned as a chef; with chemist Herve This, he founded the “discipline” of “molecular gastronomy.”  In 1969  Kurti gave a talk at the Royal Society (of which he was a member and officer) titled “The Physicist in the Kitchen”, in which he delighted his audience by using the recently-invented microwave oven to make a “reverse Baked Alaska”, aka Frozen Florida (cold outside, hot inside).  Nineteen years later, with his wife, he edited the first Royal Society cook book: But the Crackling Is Superb: An Anthology on Food and Drink by Fellows and Foreign Members of the Royal Society.

I think it is a sad reflection on our civilisation that while we can and do measure the temperature in the atmosphere of Venus, we do not know what goes on inside our souffles.

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Written by LW

May 14, 2013 at 1:01 am

When I’m good…

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Your correspondent imagines that readers have envied, as he has, the rakish sashes worn by Boy and Girl Scouts the world over– and more, the little round “emblems of competence,” the Merit Badges, with which they are bedecked.  How satisfying it would be be to advertise one’s accomplishments as one walked about!  And how gratifying to do it so much specifically than can a fancy watch or a ridiculously-expensive handbag!

Well, Dear Readers, our time has come.  Thanks to the good folks at Merit Badger, one can advertise skills and achievements in such arenas as:

Learning From Mistakes

Patience

Having No Outstanding Library Fines

Readers can visit Merit Badger to outfit themselves.

As we try to remember over which shoulder we wear the thing, we might recall that it was on this date in 1982 that arbitrageur Ivan Boesky offered Martin Siegel, a mergers-and-acquisitions executive at Kidder, Peabody & Co., a job.   Siegel declined, and Boesky then suggested that if Siegel would supply him with early inside information on upcoming mergers there would be something in it for him.

Boesky turned Siegel’s tips into profits (one example: he made over $28 million trading Carnation stock on insider info) until 1986, when the Feds arrested dozens on Wall Street for insider and related trading violations.  Boesky was convicted and sentenced to 3 years– a lighter punishment than Michael Milken’s 10 years, but still much more than Siegel’s:  as one of the few cooperating witnesses, and the only one who showed any remorse, Siegel was allowed simply to repay the $9 million he’d received from Boesky.

The 1986 case(s) were the largest stock manipulation scheme prosecuted at the time…  and may still be, though the full dimensions of the pending Galleon case are not yet known.

Envy

Lying

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